Success Stories

Activant Application Consultant Helps Distributor Reorganize and Streamline Operations

Many distributors realize they need to improve their business processes, but most do not know where to start.

"We knew there were lots and lots of areas that needed work in our business," says Cheryl Ellis, vice president of operations at Bresco, a restaurant equipment and supply distributor. "We just didn't know where to begin."

To help map solutions to better business processes, Bresco management invited an Activant Application Consultant - an expert in Activant solutions as well as the distribution industry - on site to perform a System Audit. During the System Audit, a consultant visited Bresco's headquarters in Birmingham, AL, observed company processes and system usage, and compiled a report outlining his recommendations for improvement.

The Application Consultant's suggestions ranged from reorganizing the company's warehouse to redistributing tasks among back-office employees. He also suggested ways the company could better use its Activant solution to increase its bottom line.

"After our consultant finished his evaluation, we realized how much money we could save by implementing his suggestions," Ellis says. "It was the wake-up call we needed."

Bresco management decided to bring the consultant back on a regular basis to help develop a plan to turn the ideas for improvement into reality. A year later, Ellis reports that the company has made "significant headway" in addition to seeing a considerable return on its investment.

Work in the Warehouse

Bresco's first mission with the Application Consultant was to reorganize its warehouse. Through reorganizing the bins, redesigning the warehouse, and moving A items to the front of the stockroom, Bresco reduced average pick time from 15 to 20 minutes to less than 10. "The layout of our warehouse makes much more sense now," Ellis says. "We brought the fast-moving items to eye-level. People are climbing up and down ladders less now, and finding things a lot easier."

Additionally, Bresco reduced the amount of time it spends on yearly inventory. At one time, it took the company an entire weekend - sometimes lasting through business hours Monday - to complete inventory. Now, it's finished by Sunday morning. "It's saved us a lot of money," Ellis charges. "We don't have 45 $10-an-hour people working at time-and-a-half for an extra eight hours."

Better inventory management and organization also resulted in a dramatic decrease in ship order corrections. Prior to working with the Application Consultant to revamp the stockroom, Ellis performed at least 30 and as many as 50 ship order corrections a day. Now, she never completes more than 10 - and some days, there are none.

Redeploying for ROI

To help Bresco focus on reducing Accounts Receivable (AR) days and increasing its cash balance, the Application Consultant suggested redistributing tasks among back office employees. "When you're working in a small company - especially a small company that's gotten much bigger over the years - you get used to just taking things on as they come up. The Application Consultant helped us think of ways to reorganize duties." The consultant suggested that Bresco devote one full-time employee to collections. Prior to the suggestion, accounting personnel shared departmental tasks.

Six months after Bresco implemented the consultant's recommendation, one employee - with the aid of the cash collections module - reduced outstanding AR by more than 50 percent: from $3.4 million to $1.6 million. Additionally, AR days for the company's small wares division dropped from 36 to 24 in less than a month, and over a period of six months, AR days for the company's contracts division dropped to 90 from 187. "Making better use of our solution and our human resources really made a difference," contends Ellis.

Looking at Things in a Different Way

The Application Consultant also helped Bresco staff learn how to better utilize their solution's reporting and financial and inventory management functionality, resulting in better service and fill levels. "We never really kept track of certain things before. Now we watch everything - our total inventory value, turn and earn percentages, non-stock inventory value - everything." Because of better tracking, service levels steadily increased over a period of six months, from 90 to 95 percent.

The Application Consultant's recommendations have also resulted in new company policies. Because Bresco's return stock value for non-stock items can run as high as 10 percent some months - a number the company never before realized because management did not track reports - the company has adopted a "send it back" policy. "We were keeping non-stocks before because it was easy to let salespeople tell you they'd sell it. Then, you'd wind up with a warehouse of white elephants." Now, Bresco always returns special order items to its vendors: "If we keep it, we pay for it again in storage and insurance costs." This saves the company thousands of dollars per month in dead stock.

Though implementing some of the Application Consultant's suggestions was not an easy task, Ellis contends that the benefits have outweighed all of the time spent implementing the recommendations. "Everyone here is happier now. Things still come up, but there aren't half as many issues as there once were." And the results on Bresco's bottom line? "There's no way you could put what we've done into a number at the bottom line. But I know we've saved thousands in lost inventory and man hours."

Concludes Ellis: "You get sheltered if you don't seek outside voices. You get blinders. You don't know what's out there, or how you can make things better. You really have to go looking for people with that worldly knowledge - and the Activant Application Consultant provided just that for us."

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